Slashdot Mirror
Supreme Court To Consider First Sale of Imports
Animaether passes along a legal tale that "doesn't involve the kind of cutting-edge issues that copyright lawyers usually grapple with in the digital age [and] sounds like the kind of lawsuit that should have been resolved 200 years ago," yet still "is very much a product of the Internet-driven global economy." "Can copyright owners assert rights over imported goods that have already been sold once? That is the issue before the Supreme Court in Costco Wholesale Corp v. Omega, S.A. (backstory here). What's at stake is the ability of resellers to offer legitimate, non-pirated versions of copyrighted goods, manufactured in foreign nations, to US consumers at prices that undercut those charged by the copyright holders."
What's good for the goose must be good for the gander, no?
Surely this should be a foregone conclusion
Well, this was pretty clear 200 years ago: Property was real and tangible. Copyright existed to protect the authors of works from publishers and printing presses using their work without paying for it. Fast forward 200 years and now we have copyright being applied to something that's intangible, can be copied for effectively zero cost, and has been hob-cobbled together to encompass intangible things like phrases, lines of code, even the "likeness" or "appearance" of something is not copyrightable. Given this vast expansion of the definition of copyright (for better or for worse, depending on who you ask), of course there's going to come a day when the tangible thing -- a legitimate CD purchased through legitimate channels could be declared illegal because it's being used incorrectly.
Copyright no longer covers just possession of a thing -- it's now been expanded to include the use of a thing as well, and that latter definition is what's causing most of the problems.
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You decide to outsource your programmer in bengladore, your sale rep in ireland, your telephonic support in china ? Welllll we decide to buy our game from import from the global market. Too bad they undercut your local monopoly price. Global market baby. You outsource our job, we outsource our buying. Fair is fair.
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So, if I live in England, legally buy an Omega watch there, then legally immigrate to the US, it is now a copyright violation to resell that watch on eBay?!? This flies in the face of common sense!
I've abandoned my search for truth; now I'm just looking for some useful delusions.
Highly unlikely that that would make much difference.
There is a class of activity that consists more or less exclusively of making bets about the relative movements of currencies, and there is probably some behavior in "real" markets that is affected by currency movements; but most of this stuff is just about price discrimination, which will be economically rational for sellers as long as there are multiple buyers willing to pay different amounts more than the marginal cost of production.
National borders happen to be one convenient mechanism for price discrimination; but there are many others. The idea that such techniques deserve the protection of law, against the doctrine of first sale, though, is disgusting.
If ever there was a rationale for "misuse of copyright", this is it.
The fact that the Supreme Court took the case suggests that it isn't black-letter law, doesn't it?
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
That case is just plain absurd. The argument in that case being that Importing and selling a branded item may violate the trademark rights of the brand holder? That argument could only possible be valid in the case of counterfeit goods. Otherwise trademark law just does not work like that. As long as I am selling genuine levi's jeans, I am using the trademark (the Levi's tag on the product) in a purely descriptive manner, which is part of what trademark law explicitly does not prohibit.
Unless I am missing something, I must conclude that the judge was clearly unfamiliar with the law, and depending on the lawyers to properly argue both law and fact, which is something judges do all too often despite the fact that that is forbidden. The results are verdicts that are inconsistent with the law itself.
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Precedent can be overruled, if it is flawed. In practice, I think this happens rather less often than it should. But here's the argument in favor of (some degree of) adherence to precedent.
Laws will never be precise enough that all judges will interpret them exactly the same way, so their will be corner cases where legitimate differences of judgement arise. If each judge makes a determination from scratch, then anyone unlucky enough to fall into one of these edges will get a different outcome depending what judge presides over his trial, which is bad. Also, consider the effect on people trying to obey the law unclear -- obviously, you stay out of the corners, since you can't be sure how your judge would interpret it, effectually broadening the law to the broadest reasonable interpretation (which is the wrong bias), and yet randomly failing to punish some incursions because you "got lucky" wrt judges.
By relying on precedent, the first judge who rules on some vague provision of a law lays out an interpretation, and after that everyone knows how it will be interpreted at their trial. Same justice for everyone, and if that interpretation turns out to be wrong, it may be corrected both by later judges, who can overturn bad precedent at will, and by the legislature, who can amend/replace the legislation to make it more specific and eliminate the misinterpretation.
This explains why a given item costs the same in Oklahoma and New York City.
No, it is an indicator of a worse problem. We used to have the Rule of Law. Now we have the Rule of Men. Problem is what I wrote above is so self evidently correct that this case shouldn't have made it into a courtroom at all. In a sane world, any competent attorney would have explained the law, charged the client for an hour and that would have been that. But because both sides correctly understand the bizarro reality we actually live in they are rolling the dice; since justice is now whatever a judge says and their views are randomly distributed.
The difference is when you have the Rule of Law the laws are knowable and mostly predictable. Courts are mostly occupied with determining the facts of the particular case and then applying the law to them. The occasional case will test an unexpected corner of the law but it an exception. Now the written laws mean little and judges apply their opinions of 'justice' to cases and their rulings are thus mostly unknowable beforehand. This of course means everyone take a try at court as soon as they have nothing left to lose.
Democrat delenda est
Wrong, wrong, wrong! The planet already has a global currency, it's called "gold". Ask yourself this: would the disparities in pricing still exist if all contracts were payed in gold? The different prices for each country are driven by marketers trying to charge whatever cost the market will bear, this has little or no connection to currency exchange rates. Manufacturing is cheaper where the labor costs are cheaper; again, this has nothing to do with exchange rates. Also, the Euro is an ongoing experiment in a multinational currency which is about to fail due to being dragged down by Greece.
I've abandoned my search for truth; now I'm just looking for some useful delusions.
It has long been held as illegal to engage in price fixing. Region coding for DVDs, for example, is most often used for the purpose of controlling initial distribution (which is their right) to release certain things in certain areas at certain times (which is not their right entirely). Once something is legally sold, they no longer own the rights to anything about it excepts for its duplication which includes various forms of duplication such as public playback or performance. But to individually sold items are no longer under the control of the publisher and the disc or tape or book can be transported and sold anywhere else. All of this is established in precedent or is otherwise understood as common law. You can buy a book, sell a book or even lend a book. Why this wouldn't apply to DVDs or other media defies logic. To make this truly the case, they will have to redefine copyright law to disallow someone to resell that which they have bought. This would be a very bad move for copyright holders as fewer people would be interested in buying something they couldn't later liquidate if some unfortunate event occurs in the future. Instead, people would do only rental and, of course, illegal copying.
Copyright holders have long wanted to be able to control the resale of their goods. Take, for example, the diamond trade -- they really have it the way they want it. Diamonds are super expensive new but if you try to sell one, you will find you will not get much for it... and further, you will find their prices "used" as more than inexpensive. (Wanna buy an engagement ring? Go to a pawn shop.... seriously) But law all around the planet have made this sort of control over the market illegal. This is why DeBeers cannot operate in the U.S. and many other countries legally. If copyright holders want that level of control, they will find themselves unable to operate legally in the very countries they do business. It's conceivable that they would simply buy laws that exclude their own products, but buying laws are a tricky thing and subject to constitutional rules.
Regulate the US Market and its bye bye medical research.
While it is true that the US does a good bit of the heavy lifting in medical research, it is FAR from true that all medical research depends on the US. Many medical companies and research institutions exist and are headquartered outside the US including some of the biggest pharmaceutical companies. Plenty of research goes on across the world without the US being involved.
Please note that I'm not dismissing your general thesis completely - price controls are something to be approached with great caution. However it is not fair to say that all price regulation is a bad idea. Access to medicine is a moral issue as much as it is an economic one. Many medicines are sold for profit margins that are hard to justify to anyone with a conscience. It's fine for drug companies to make a profit, a handsome profit even. But resources for medical care are finite and just because a drug company is able to charge a lot doesn't always mean they should.
I would challenge the argument that the Omega is copyrighted by pointing out that it was put on the product by the manufacturer, and the right to use the product was acquired by a legal purchase, and moreover exerting that right is indivisible from the product and thus the logo.
Hey don't blame me, IANAB
You have to pretty much throw away any pretense of fairness for a doctrine which holds that every copyright applies in every country, but first sale rights (copyright exhaustion) only apply in the country of first sale.
In the past, I owned / operated a small electronic sales / service store in a smaller American town. Life was good, but the revenue from TV repairs wasn't quite enough to keep the business going. People were asking for high-end car stereos so I looked into becoming a dealer for a Japanese manufacturer. The requirements and restrictions they wanted were unacceptable and the wholesale pricing they offered was far too high.
What ended up being the solution was to purchase this company's products in Britain at retail and have them shipped to this country. Even after the currency exchange fees and shipping the cost was about half of what the company wanted me to pay for those items. That was fine with me and I sold them on to end customers at just under what that company wanted me to pay them as the wholesale cost.
It wasn't too many months until an electronics dealer in another town discovered that I was selling these car stereos for less than he was paying for them. He contacted the manufacturer and complained and they sent me a letter demanding that I conform to the minimum selling price or face losing their wholesale pricing. In my reply to them, I believe I suggested that they do something sexually improbable to themselves. When they threatened to sue, I just put their letters in the trash - I had no contract with them and didn't purchase anything from them so they could just go F themselves as far as I was concerned. I never revealed where I was getting their products and a lot of happy customers bought and enjoyed them.
Was I doing something wrong? I suppose it would depend on who you ask. I was happy; the additional profits were most welcome. And the customers were happy because they got a great deal on their new car stereo. Anyway, those stereos were what is commonly called "gray market" goods. That's a curious designation - the only "law" that was being violated was a dealer agreement that I wasn't a party to. If that manufacturer would have had their own way, my customers would have paid twice as much for their car stereos. Some might say that the stereo manufacturer was engaging in price fixing.
The whole idea of a producer of goods being able to dictate what those goods sell for at retail is a curious concept. It's legal and American law allows "minimum selling price" agreements. But is it good for consumers? Or is it just another way that corporations take advantage? That stereo manufacturer was happy to take the British price for those stereos but somehow when I sold them in the USA at a profit they felt that they were being harmed.
These anti-consumer agreements are everywhere - but nobody will tell you about them. Next time you're shopping for a deal on some item and notice that it's exactly the same price at every dealer you check - you're looking at a "minimum selling price" item. Nobody will give you a discount because if they do their source of supply will be cut off. So when you buy an Apple product - or a Timex watch - or hundreds of other items you're paying a higher price than the dealer might offer you. What does it mean for competition when all competitors have to sell at the same price?
There's no such thing as a "free market" when a third party to a sales transaction can dictate the terms of that transaction. Look around you and you'll see this kind of consumer abuse everywhere. We've been putting up with this for a long time - it's time for a change and I hope Costco can make a start at changing this situation.